TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Thursday, October 5, 2017

2018 Times Higher Education World Law School Rankings

THETimes Higher Education has released its 2018 ranking of the Top 100 Law Schools in the world, based on this methodology:

  • Teaching:  The Learning Environment (32.7%)
  • Research:  Volume, Income and Reputation (30.8%)
  • Citations:  Research Influence (25%)
  • International Outlook:  Staff, Students and Research (9%)
  • Industry Income:  Innovation (2.5%)

Here are the Top 25 law schools:

  1. Duke
  2. Stanford
  3. Yale
  4. Chicago
  5. Cambridge
  6. Oxford
  7. Melbourne
  8. University College London
  9. Harvard
  10. Toronto
  11. Pennsylvania
  12. NYU
  13. Melbourne
  14. Edinburgh
  15. Michigan
  16. British Columbia
  17. Columbia
  18. Hong Kong
  19. UC-Berkeley
  20. Leiden
  21. UCLA
  22. Cornell
  23. Amsterdam
  24. KU Leuven
  25. Georgetown

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October 5, 2017 in Law School Rankings, Legal Education | Permalink | Comments (3)

The IRS Scandal, Day 1610: Inspector General Says IRS Gave Extra Scrutiny To Liberal Groups, Undermining GOP Claims Of Ideological Targeting Of Conservative Groups By IRS

IRS Logo 2Washington Post, Liberal Groups Got IRS Scrutiny, Too, Inspector General Suggests:

A federal watchdog has identified scores of cases in which the Internal Revenue Service may have targeted liberal-leaning groups for extra scrutiny based on their names or political leanings, a finding that could undermine claims that conservatives were unfairly targeted under President Barack Obama.

The Treasury Inspector General for Tax Administration (TIGTA) reviewed cases between 2004 and 2013, which includes the period TIGTA previously examined in a 2013 report that faulted the IRS for using inappropriate political criteria to select groups for heightened scrutiny.

That earlier report found that 96 groups with names referencing “Tea Party,” “Patriot” or “9/12” were selected for intensive review between May 2010 and May 2012, and the House Ways and Means Committee later identified another 152 right-leaning groups that were subjected to scrutiny. Those findings fueled accusations by Republican lawmakers that the Obama administration engaged in politically motivated targeting of conservatives.

But Democrats have long challenged those claims, arguing that liberal-leaning groups were given close scrutiny alongside the conservative groups. The 2013 TIGTA report, they argued, was based on selective criteria that omitted numerous nonconservative groups that were also subjected to close IRS review.

The new report examines a broader range of criteria used by the IRS. It does not characterize the politics of the groups that were selected for scrutiny, a TIGTA spokeswoman emphasized Wednesday. But many of the 17 criteria the report examined had obvious political overtones — including affiliation with the now-defunct Association of Community Organizations for Reform Now (ACORN), as well as names referencing “Progressive,” “Green Energy,” “Medical Marijuana,” and “Occupy.”

Together, the watchdog identified 146 cases in which the IRS examined groups for suspicion of engaging in disallowed political activity using those criteria. Eighty-three of those were definitively chosen for scrutiny because of the selection criteria, the inspector general found; the report could not definitively determine how the other cases were chosen.

The Washington Post reviewed a version of the TIGTA report dated Sept. 28 that has been circulated to various lawmakers and committees on Capitol Hill. The full report is set to be released to the public Thursday.

The new report reiterates the inspector general’s earlier criticism of the IRS review process at the time, calling it “inappropriate” to target groups for scrutiny based on their names rather than on actual evidence of illicit political activity that would leave them ineligible for tax exemptions.

Groups that were selected for review waited months — years, in some cases — for their applications to be reviewed and were subjected to onerous and, in some cases, improper requests for information on their donors and activities. ...

Brady said in a statement Wednesday that the new TIGTA report “reinforces what government watchdogs and congressional investigators have confirmed time and time again: bureaucrats at the IRS, such as Lois Lerner, arbitrarily and haphazardly administered the tax code and targeted taxpayers based on political ideology.” He pledged to “continue holding the IRS accountable for their actions.”

Rep. Sander M. Levin (D-Mich.), who served as the top Democrat on the Ways and Means Committee during the height of the IRS scandal, said Wednesday that the report confirmed “political manipulation by the Republicans.” “They were trying to squeeze whatever political juice they could out of this,” he said. “Incompetence is different than a political witch hunt. There never was one, at least one that anybody could identify.”

DeBonis

Brunson

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October 5, 2017 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

E.U. Pushes To Collect More Taxes From Big Tech; Experts Say U.S. Must Not Cede Its Share Of The Tax Pie To Other Countries

New York Times, E.U., Citing Amazon and Apple, Tells Nations to Collect Tax:

European competition regulators on Wednesday mounted a push against tax avoidance by Silicon Valley giants, announcing plans to take Ireland to court for failing to collect back taxes from Apple and ordering Luxembourg to claim unpaid taxes from Amazon.

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October 5, 2017 in Tax | Permalink | Comments (0)

Why Do Law Profs Provide Peer Review Of Scholarship, But Not Teaching?

Mary Lynch (Albany), Experience with Peer Support, Peer Review and Feedback on Teaching?

We are all familiar with engagement in peer review of scholarship. Law faculty culture prioritizes peer input and review of scholarly ideas and articles. Sending drafts of articles to colleagues for feedback, “workshopping” preliminary ideas, and vetting scholarship is part and parcel of the work we do. We visit other schools, make presentations and attend conferences because we value peer discussion and input. It is the basis by which we create and communicate knowledge.

I don’t believe, however, we have a similarly pervasive culture for formative peer review when it comes to teaching in law schools, although such culture exists at other higher education institutions.

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October 5, 2017 in Legal Education | Permalink | Comments (3)

The IRS Scandal, Days 1501-1600

October 5, 2017 in IRS News, IRS Scandal | Permalink | Comments (0)

Wednesday, October 4, 2017

Mason Presents Whose Arm's-Length Standard? Today At Northwestern

Mason (2016)Ruth Mason (Virginia) presents Tax Rulings as State Aid — Part 4: Whose Arm's-Length Standard?, 155 Tax Notes 947 (May 15, 2017), at Northwestern as part of its Advanced Topics in Taxation Workshop Series hosted by Sarah Lawsky:

In this fourth part in a series of reports on state aid, Mason focuses on the element of “advantage” in EU state aid law, and she criticizes the European Commission’s doctrinal approach to identifying advantages for state aid purposes. In particular, this article addresses the divergence between the EC’s and OECD’s conceptions of the arm’s-length principle. ...

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October 4, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Herzig: Trump's Repatriation Tax Holiday Would Be Boon To Shareholders, Not Workers: 'A Holiday From Sensible Tax Policy'

New York Times op-ed:  The Trump Tax Idea That’s a Boon for Shareholders, by David Herzig (Valparaiso):

One of the proposals in the Republican tax plan set out last week — a bid to get American corporations to “repatriate” their untaxed corporate overseas profits — has support both in Congress and in the Trump administration. As much as $2.6 trillion in such profits sits in offshore subsidiaries of United States corporations.

Under the plan, the government would declare a tax holiday — a rate as low as 10 percent — to encourage the United States companies operating overseas to repatriate their overseas profits. Congress and the president see getting this money back to the United States as a way to goose job and wage growth in the United States and to fill some of the revenue holes that are expected as a result of the plan’s other sweeping tax cuts.

Treasury Secretary Steven Mnuchin, for instance, said that the tax break “will bring back trillions of dollars that are offshore to be invested here in the United States to purchase capital and to create jobs.” President Trump echoed those sentiments during his campaign.

In reality, when corporations repatriate offshore earnings during a tax holiday, the largest beneficiary of the giveaway is not working Americans but corporate shareholders.

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October 4, 2017 in Tax | Permalink | Comments (0)

Law School Is Changing Its Name To 'Hillary Rodham Clinton School of Law'

HRC

Townhall, A University in Wales is Renaming Its Law School After Hillary Clinton:

Swansea University in Wales is renamingi ts law school after Hillary Clinton and will honor the two-time presidential candidate and former secretary of state with an honorary degree. Clinton is being honored for her "commitment to promoting the rights of families and children around the world," and will receive the degree on October 14.

WalesOnline, Hillary Clinton Is Visiting Swansea Next Month to Collect a Top Honour:

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October 4, 2017 in Legal Education | Permalink | Comments (2)

Democrats And Republicans Blast IRS's Decision To Award Equifax $7.25m No-Bid Contract To Prevent Taxpayer Identity Theft: 'I Thought I Was Reading The Onion'

EIRSPolitico, IRS Awards Multimillion-Dollar Fraud-Prevention Contract to Equifax:

The IRS will pay Equifax $7.25 million to verify taxpayer identities and help prevent fraud under a no-bid contract issued last week, even as lawmakers lash the embattled company about a massive security breach that exposed personal information of as many as 145.5 million Americans.

contract award for Equifax's data services was posted to the Federal Business Opportunities database Sept. 30 — the final day of the fiscal year. The credit agency will "verify taxpayer identity" and "assist in ongoing identity verification and validations" at the IRS, according to the award. ...

Lawmakers on both sides of the aisle blasted the IRS decision.

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October 4, 2017 in IRS News, Tax | Permalink | Comments (0)

20 Of 21 California Law School Deans Urge Supreme Court To Lower Bar Exam Cut Score On Interim Basis Pending Further Study

California Bar ExamLetter from Deans of 20 of the 21 ABA-Accredited California Law Schools to the Supreme Court of California (Oct. 2, 2017):

[W]e seek here to highlight what we believe are the key points for the Court's consideration, as well as to ask the Court for specific relief. We have organized this letter in four sections, as follows:

  1. We respectfully request that the Court schedule a meeting (or a hearing) with the State Bar, the Deans of the California law schools, and any other parties the Court believes should be present.
  2. We respectfully restate the position that we advanced during the public comment period, that the Standard Setting Study does not provide a valid basis to set an interim cut score. We include as attachments to this submission supporting Comments that set forth in detail the significant flaws present in the Standards Setting Study. We also briefly discuss the additional studies that we believe should be undertaken.
  3. We address the principal policy consequences that would follow from retaining California's exceptionally high current cut score of 1440, and state why we believe that, based on those policy considerations, the adoption of an interim cut score between 1350 and 1390 would best serve the public interest while the Court authorizes studies that are more thorough
  4. Conclusion.

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October 4, 2017 in Legal Education | Permalink | Comments (5)

Washington University Is Sixth Law School To Accept GRE For Admissions

GREFollowing up on my previous posts (links below):  Washington University is the sixth law school to accept the GRE as an alternative to the LSAT,  joining (in chronological order) Arizona, Harvard, Northwestern, Georgetown, and Hawaii.  From Dean (and Tax Prof) Nancy Staudt's announcement:

“WashULaw wants to appeal to the best students in the country and the world, regardless of their academic, professional or personal background,” said Nancy Staudt, dean and the Howard & Caroline Cayne Professor of Law. “The class beginning this fall was one of the most accomplished and diverse in the history of WashULaw. The decision to accept the GRE will continue to build on these efforts, making the admissions process even more accessible to highly qualified and motivated students of all backgrounds interested in pursuing a legal education.” ...

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October 4, 2017 in Legal Education | Permalink | Comments (0)

The Corporate Response To Government Attacks On Tax Shelters

Noel Brock (Eastern Michigan), Edward Schnee (Alabama) & Shane Stinson (Alabama), The Corporate Response to Government Attacks on Tax Shelters, 8 Int'l J. Fin. Res. (2017):

We examine the effectiveness of four federal government actions, all of which were designed to curb the proliferation of corporate tax shelters dating back to the 1990s, at eliciting measurable changes in characteristics commonly associated with tax shelter firms. Our results suggest that the government’s initial attacks on corporate tax shelters in the early 2000s elicited significant declines in book-tax differences, discretionary accruals, and the use of Big N audit firms, which contributed to gradual reductions in the estimated likelihood of tax sheltering for both multinational and purely domestic firms. Conversely, later attempts to discourage corporate tax shelters proved ineffective, likely due in part to the effectiveness of previous government attacks and a faltering economy.

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October 4, 2017 in Scholarship, Tax | Permalink | Comments (1)

Ex-Big Law Associate Who Flunked Bar Can Proceed With Suit Against Examiners

WycheFollowing up on my previous post, Harvard Grad Who Flunked Bar Sues Over Loss Of Big-Law Job:  American Lawyer, Ex-Big Law Associate Who Flunked Bar Can Proceed With Suit Against Examiners:

A former Ropes & Gray associate and Harvard Law School grad who failed the bar exam twice can move ahead with parts of her federal lawsuit against the New York State Board of Law Examiners.

Tamara Wyche sued the board and its individual members in 2016, claiming the board's denial of testing accommodations, which she received in law school, caused her to fail the attorney licensing exam and lose her lucrative associate job at Ropes & Gray.

U.S. District Judge Raymond Dearie of the Eastern District of New York formally dismissed two of Wyche's four claims — brought under the Americans With Disabilities Act and the New York City Human Rights Law — in a Sept. 25 opinion [T.W. v. New York State Board of Law Examiners, No. 16-CV-3029 (E.D.N.Y. Sept. 26, 2017)], although Wyche already had agreed to withdraw those claims.

But Dearie deferred ruling on her two remaining claims — alleged violations of the ADA and Section 504 of the Rehabilitation Act of 1973 — in order to allow for discovery into whether they are barred under New York's sovereign immunity.

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October 4, 2017 in Legal Education | Permalink | Comments (5)

Tuesday, October 3, 2017

Fullerton Presents Vertical And Horizontal Redistributions From A Carbon Tax And Rebate Today At Columbia

FullertonDon Fullerton (Illinois) presents Vertical and Horizontal Redistributions from a Carbon Tax and Rebate (with Julie-Anne Cronin (U.S. Treasury Department) & Steven Sexton (Duke)) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium Series hosted by Alex Raskolnikov and Wojciech Kopczuk:

Because electricity is a higher fraction of spending for those with low income, carbon taxes are believed to be regressive. Many argue, however, that their revenues can be used to offset the regressivity. We assess these claims by employing data on 322,000 families in the U.S. Treasury’s Distribution Model to study vertical redistributions between rich and poor, as well as horizontal redistributions among families with common incomes but heterogeneous energy intensity of consumption (different home heating and cooling demands).

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October 3, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Senate Holds Hearing Today On International Tax Reform

Senate LogoThe Senate Finance Committee held a hearing today on International Tax Reform:

October 3, 2017 in Congressional News, Tax | Permalink | Comments (0)

Technology Offers Law Grads New Ways To Tap Into Job Market: Networking, Analytics, And Apps

American Lawyer, Technology Offers Law School Grads New Ways to Tap into the Job Market:

Law students or grads fresh out of law school have some new technologies at their disposal for getting into the job market. Here’s a look at some of the new tools helping new lawyers get a foot in the door to their legal career.

Teaching What Law Schools Don’t: Networking:
Among databases of legal job listings, and how-to resume and interview guides, some law schools around the country are offering something novel. It is a tool that instead of automatically introducing students to legal employers teaches them how to make their own connections. Lawcountability J.D., a cloud-based app that offers instructional videos on how prospective attorneys can market themselves and network, was recently deployed in over U.S. 70 law schools nationwide. ...

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October 3, 2017 in Legal Education | Permalink | Comments (1)

TIGTA: IRS Must Ensure That Volunteer Income Tax Assistance Is Given Only To Eligible Taxpayers (200,000 Returns Were Prepared For Ineligible Taxpayers, Including Four With AGIs > $1 Million)

TIGTAThe Treasury Inspector General for Tax Administration has released Improvements Are Needed to Ensure That the Volunteer Income Tax Assistance Grant Program Extends Tax Return Preparation to Underserved Populations (2017-40-088):

TIGTA’s review of the almost 4.5 million tax returns prepared by grantees during Grant Years 2014 through 2016 identified that: 1) volunteers prepared 201,572 (4 percent) returns with an Adjusted Gross Income amount that exceeded the income threshold set for free tax return preparation, including 34,371 returns with an Adjusted Gross Income greater than $100,000 and 11 returns with an Adjusted Gross Income exceeding $1 million; 2) the IRS could not verify if 456,220 (10 percent) tax returns with complex tax schedules were prepared by volunteers with advanced certifications; and 3) 15,402 returns were out of scope. Finally, some guidelines and procedures were not current or consistent.

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October 3, 2017 in Gov't Reports, IRS News, Tax | Permalink | Comments (1)

McGinnis: The AALS Claims To Favor The Public Interest, While Advancing Its Own

AALS (2018)John O. McGinnis (Northwestern), The Association of American Law Schools Claims to Favor the Public Interest, While Advancing Its Own:

The American Association of Law Schools (AALS) is a professional guild. It never misses a chance to proclaim that it is working in the public interest, while nevertheless focusing on its own interests —expanding the perquisites and number of its members.  The latest newsletter makes this combination even more visible than usual. It devoted its opening essay to Access to Justice — which it claims to favor. Simultaneously, it announced its opposition to a proposal of the American Bar Association, now operating under the watchful eye of Antitrust Division, which could decrease the cost of going to law school — one of the principal barriers to access.   The problem is that the proposal might well over time reduce the number of tenured professors, who, of course, run the AALS.

The ABA proposes that after the first year of law, accredited law schools could permit part-time teachers to teach any or all second and third year courses. The first year would remain mainly the province of a full-time faculty. The rationale of the AALS’s opposition is that “full time faculty are essential to providing quality education.” It provides no empirical support for this claim. ...

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October 3, 2017 in Legal Education | Permalink | Comments (1)

Christians: Residence And Citizenship By Investment

Allison Christians (McGill), Buying in: Residence and Citizenship by Investment, 61 St. Louis U. L.J. ___ (2017):

States have complex and often conflicted attitudes toward migration and citizenship. These attitudes are not always directly expressed by lawmakers, but they may be reflected quite explicitly in tax regimes: for the world’s most prosperous individuals and their families, multiple states extend a warm welcome. Sometimes prospective migrants are offered fast track to physical residence which can lead to citizenship if the migrant desires it. Others are offered a mere commercial transaction, with citizenship granted to applicants with the right credentials and a willingness to pay. Migrants might seek to obtain residency or citizenship for personal, family, economic, or tax reasons, or some combination of them. For the granting country, the tax significance of obtaining new residents or citizens will vary depending on domestic policy goals. However, the consequences of residence and citizenship by investment programs could be severe for the international tax regime: the jurisdiction to tax and the allocation of taxing rights among countries are commonly based on residence and citizenship factors.

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October 3, 2017 in Scholarship, Tax | Permalink | Comments (0)

Governor Brown Signs Bill Authorizing Release Of Names Of Those Who Pass California Bar Exam

California Bar ExamYesterday, Governor Jerry Brown signed into law Senate Bill No. 690, which authorizes the state bar to release the names of applicants to pass the bar exam, effective January 1, 2016.  So law schools will no longer have to troll social media to try to determine whether their graduates passed the bar.  Here is the description of the bill:

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October 3, 2017 in Legal Education | Permalink | Comments (1)

Sitkoff: The Rise Of Trust Decanting In The United States

Robert H. Sitkoff (Harvard), The Rise of Trust Decanting in the United States, 23 Trusts & Trustees ___ (2017):

In a trust decanting, a trustee who under the terms of a trust (the first trust) has a discretionary power over distribution uses that power to distribute the trust property to a new trust (the second trust) with updated provisions, leaving behind the sediment of the first trust’s stale provisions. This article canvasses the rise of trust decanting in American trust practice, taking notice of its common law origins, its contrast with traditional American doctrine on trust modification and termination, the proliferation of state trust decanting statutes, and several areas of doctrinal divergence across the states.

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October 3, 2017 in Scholarship, Tax | Permalink | Comments (0)

Monday, October 2, 2017

Kleinbard Presents The Right Tax At The Right Time Today At Loyola-L.A.

Kleinbard (2015)Edward Kleinbard (USC) presents The Right Tax at the Right Time, 20 Fla. Tax Rev. ___ (2017), at Loyola-L.A. today as part of its Tax Policy Colloquium Series hosted by Ellen Aprill and Katherine Pratt:

The companion paper to this (Capital Taxation in an Age of Inequality, 90 S. Cal. L. Rev. 593 (2017)) argues that a moderate flat-rate (proportional) income tax on capital imposed and collected annually has attractive theoretical and political economy properties that can be harnessed in actual tax instrument design. This paper continues the analysis by specifying in detail how such a tax might be designed.

The  idea of the Dual Business Enterprise Income Tax, or Dual BEIT, is to offer business enterprises a neutral profits tax environment in which to operate, in which normal returns to capital are exempt from tax by means of an annual capital account allowance termed the Cost of Capital Allowance (COCA). In turn, investors in firms include in income each year the same COCA rate, applied to their tax basis in their investments. The result is a single tax on capital income (rents plus normal returns), where the tax on normal returns is imposed directly on the least mobile class of taxpayers. Labor income continues to be taxed at progressive tax rates.

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October 2, 2017 in Colloquia, Scholarship, Tax | Permalink | Comments (0)

Lawyers Bill Only 2.3 Hours Per 8-Hour Workday?

American Lawyer, What Do Lawyers Really Do With Their Time?:

No wonder so many lawyers in this country work long hours to meet productivity goals. A recent billing trends report finds lawyers spend only 29 percent of each workday on billable time.

That’s only 2.3 hours of billable time for each eight-hour workday, according to the second annual Legal Trends Report, which was prepared and made public today by Clio, a Canadian company that provides cloud-based practice management for firms. The report includes data analysis and also the results of a survey of legal professionals and consumers.

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October 2, 2017 in Legal Education | Permalink | Comments (5)

Morse Reviews Lawsky's Formalizing The Code

Jotwell (Tax) (2016)Susan Morse (Texas), When the Life of the Law Is Logic (JOTWELL) (reviewing Sarah Lawsky (Northwestern), Formalizing the Code, 70 Tax L. Rev. 377 (2017):

In Formalizing the Code, Professor Sarah Lawsky offers a glimpse of what might be gained if law were written in formal logic language. It might be written by machine-language specialists attached to Congressional tax-writing committees. It could reduce unintentional ambiguity and complexity. Computers could understand it.

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October 2, 2017 in Scholarship, Tax | Permalink | Comments (0)

NY Times: Professors Behaving Badly

AdjunctNew York Times Sunday Review, Professors Behaving Badly:

Is there something about adjunct faculty members that makes them prone to outrageous political outbursts?

In August, Michael Isaacson, an adjunct instructor of economics at the John Jay College of Criminal Justice in New York, wrote on Twitter, “Some of y’all might think it sucks being an anti-fascist teaching at John Jay College but I think it’s a privilege to teach future dead cops.” Though he later said he was not wishing for his students’ deaths, but merely predicting some would die, his post was roundly condemned. He received death threats and was suspended from his job, ostensibly in the interest of campus safety. ...

Conservative commentators have glossed these incidents as the latest evidence that college and university faculties have been taken over by left-wing radicals. But the incidents might be viewed as part of a different phenomenon: adjunct alienation.

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October 2, 2017 in Legal Education | Permalink | Comments (2)

U.S. District Court Strikes Down Obama-Era Anti-Inversion Regulation, Limiting IRS's Power To Make Rules That Skirt The APA

Chamber of Commerce v. IRS, No. 1:1 6-CV-944 (W.D. TX Sept. 29, 2017) (citations omitted):

In April 2016, the Internal Revenue Service and the United States Department of the Treasury (the "Treasury Department") (together, the "Agencies") issued a rule identifying stock of foreign acquiring corporations that is to be disregarded in determining an ownership fraction relevant to categorization for federal-tax purposes because the stock is attributable to prior domestic-entity acquisitions. 26 C.F.R. § 1 .7874-8T (the "Rule"). The Rule was simultaneously issued as a temporary regulation effective immediately and as a proposed regulation subject to notice and comment. 26 C.F.R. § 1.7874-8T(j); Prop. Treas. Reg. § 1.7874-8.

Plaintiffs, the Chamber of Commerce of the United States of America (the "Chamber") and the Texas Association of Business, now bring this lawsuit asserting Defendants, the Internal Revenue Service, Treasury Department, John A. Koskinen, and Jacob J. Lew, violated the Administrative Procedures Act (the "APA") by promulgating the Rule.

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October 2, 2017 in IRS News, New Cases, Tax | Permalink | Comments (1)

Architectural Digest: Law Schools Have Three Of The Eight Ugliest University Buildings In America

Architectural Digest, The 8 Ugliest University Buildings in America:

Though not reflective of the caliber of the schools that built them, these campus façades are undeniable eyesores.

University of Baltimore School of Law:

Baltimore

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October 2, 2017 in Legal Education | Permalink | Comments (5)

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October 2, 2017 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

Lesson From The Tax Court: When Precedent Is A Game Of Telephone

Tax Court (2017)In a fully reviewed 28 page opinion released Thursday, September 28, 2017, the Tax Court gave full attention to an important problem: when a married taxpayer files a return with an impermissible filing status (such as single or head of household) can the spouses later still elect to file jointly or do the restrictions in §6013(b)(2) apply?

The case is Fansu Camara and Aminata Jatta v. Commissioner. The opinion is worth your time not only for the well-reasoned outcome, but also for its neat demonstration of how precedent sometimes operates like a game of telephone. First I will need to sketch out the facts and holding for you. And then I will have one tax policy observation about the outcome. But I promise it won’t be 28 pages. So, if you are brave, you will continue reading below the fold.

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October 2, 2017 in Bryan Camp, New Cases, Tax, Tax Practice And Procedure | Permalink | Comments (1)

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October 2, 2017 in About This Blog, Legal Education, Tax | Permalink | Comments (0)

TaxProf Blog Weekend Roundup

Sunday, October 1, 2017

Hackney: Subsidizing The Heavenly Chorus — Labor Unions And Tax Exemption

Philip Hackney (LSU), Subsidizing the Heavenly Chorus: Labor Unions and Tax Exemption, 91 St. John's L. Rev. ___ (2017):

Labor Unions are nonprofit organizations that provide laborers a voice before their employer and before governments. They are classic interest groups. United States federal tax policy exempts labor unions from the income tax, but effectively prohibits labor union members from deducting union dues from the individual income tax. Because these two policies directly impact the political voice of laborers, I consider primarily the value of political fairness in evaluating these tax policies rather than the typical tax critique of economic fairness or efficiency. I apply a model that presumes our democracy should aim for one person, one political voice. For the model, political voice means the ability of citizens to participate in setting and discussing the political agenda and to vote on any final decision. In a modern democratic state, citizens largely depend upon organized interest groups to fulfill this role of political voice. In the Article, I demonstrate that tax policy applicable to labor unions likely modestly harms political voice equality.

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October 1, 2017 in Scholarship, Tax | Permalink | Comments (0)

How Long Does It Take To Become A Good Lawyer? Five Years?

ABA Journal (2014)ABA Journal, How Long Did It Take For You to Feel Like You Were a Good Lawyer?:

At the Law21 Blog this month, legal market analyst Jordan Furlong asked LinkedIn followers who started their careers as law firm associates how many years of practice it took them to feel like “a reasonably competent and confident lawyer.” The median answer? Five years.

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October 1, 2017 in Legal Education | Permalink | Comments (0)

At The Movies With A Law School Dean: Dunkirk And Detroit

DDNick Allard (Dean, Brooklyn), Three Crucibles and a Funeral:

Respected chroniclers of some of the most dire breakdowns in our government are optimistic. Commentators across diverse fields, including those I recently interviewed at the Brooklyn Book Festival — Sheryll Cashin, professor of law at Georgetown Law School and author of Loving: Interracial Intimacy in America and the Threat to White Supremacy; and Norman Ornstein, resident scholar at the American Enterprise Institute and author of One Nation After Trump: A Guide for the Perplexed, the Disillusioned, the Desperate, and the Not-Yet Deported, are convinced that our current troubles are the jolt we need to spur citizens to engage with and make our government more responsive and just. During our interview, both commentators see an increase in citizen action on a number of fronts that has the potential to bring about transformational change.

Professor Cashin, for example, believes that, notwithstanding centuries of abhorrent laws favoring and supporting the supremacy of white people in America, including those laws interfering with interracial intimacy, and the physical mistreatment and exploitation of African Americans, we are advancing toward an era of “cultural dexterity,” in which interactions of all kinds – social, cultural, economic, intimate – are commonplace and accepted as the norm rather than the exception. During the C-span covered interviews, we also discussed how popular culture including,  as noted by my friend of thirty plus years Norm Ornstein, movies like Dunkirk demonstrate that history tips in favor of the better angels of our human nature.

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October 1, 2017 in Legal Education | Permalink | Comments (0)

The Top Five New Tax Papers

SSRN LogoThere is a bit of movement in this week's list of the Top 5 Recent Tax Paper Downloads, with a new paper debuting on the list at #5:

  1. [687 Downloads]  Federal Tax Procedure (2017 Practitioner Ed.), by John Townsend (Houston)
  2. [359 Downloads]  Is Efficiency Biased?, by Zachary Liscow (Yale)
  3. [252 Downloads]  When Did Tax Avoidance Become Respectable?, by Steven Bank (UCLA)
  4. [198 Downloads]  Codification of the Tax Law and the Emergence of the Staff of the Joint Committee on Taxation, by George Yin (Virginia)
  5. [139 Downloads]  Inverted Theories, by Lee Anne Fennell (Chicago) & Richard H. McAdams (Chicago)

October 1, 2017 in Scholarship, Tax, Top 5 Downloads | Permalink | Comments (0)

Saturday, September 30, 2017

This Week's Ten Most Popular TaxProf Blog Posts

Do BigLaw Partners Qualify For Trump's 25% Rate On Income From Pass-Through Entities?

Tax ReformAmerican Lawyer, Law Firms, Partners Await Answers on Trump Tax Plan:

Will big law firms and their partners benefit from the new Republican tax plan promoted by President Donald Trump? Not necessarily, according to tax experts who said some gains may be eroded by loss of crucial deductions.

The one thing tax experts all agree on is that the proposed framework is very short on details and not clear enough to make any conclusions.

In one of its general statements, the framework said it would limit the maximum tax rate applied to the business income of small and family-owned businesses conducted as sole proprietorships, partnerships and S corporations — known as pass through entities — to 25 percent.

So if a law firm qualified — and that’s a big if — partners who pay 39.6 percent may pay 25 percent instead.

But the framework suggests this is only for small businesses, and tax experts said large law firms probably wouldn’t be included in that group.

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September 30, 2017 in Legal Education, Tax | Permalink | Comments (0)

California Lawmakers Approve Bill Requiring Presidential Candidates To Release Five Years Of Tax Returns

Trump Tax ReturnsABA Journal, California Lawmakers Approve Bill Requiring Presidential Candidates to Release Tax Returns:

Presidential candidates who want to appear on the California ballot would have to release their tax returns if a bill passed earlier this month is signed into law.

Senate Bill 149 passed on Sept. 15 despite questions about its constitutionality, report the San Jose Mercury NewsBloomberg BNA and an op-ed in the Los Angeles Times.

The bill requires presidential candidates on the ballot to release five years of tax returns. A redacted version would be posted online.

The deadline for California Gov. Jerry Brown to sign or pass the bill is Oct. 15, but it’s unclear what he will do. Brown released his tax returns in his first two gubernatorial races, but didn’t do so in 2010 or 2014 when his opponents didn’t release theirs.

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September 30, 2017 in Tax | Permalink | Comments (2)

Law’s Picture Books: Illustrating The Letter Of The (Tax) Law

YaleWall Street Journal, ‘Law’s Picture Books: The Yale Law Library Collection’: Illustrating the Letter of the Law:

Picture books about the law are as superfluous as songs about economics. In legal codices and textbooks, illustrations can even seem frivolous. Before visiting the Grolier Club’s exhibition Law’s Picture Books: The Yale Law Library Collection, you might also believe this is as it should be: Justice typically devalues the visual. Not for nothing is Lady Justice blindfolded — as we see in many texts displayed at this unusual exhibition. The law library’s rare book librarian, Michael Widener, has been collecting illustrated law books for the institution, and now he and his co-curator, the legal scholar Mark S. Weiner, have offered an eye-opening survey of that specialty.

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September 30, 2017 in Book Club, Legal Education, Tax | Permalink | Comments (1)

Friday, September 29, 2017

Weekly SSRN Tax Article Review And Roundup

This week, David Gamage (Indiana) reviews a new draft article by Allison Christians (McGill Law), Buying in: Residence and Citizenship by Investment.

Gamage (2017)Want to buy yourself a citizenship?  According to Christians’s new draft article, doing so from Panama would cost you $5,000 USD, doing so from the United Kingdom would cost you $62,525 USD, and doing so from Singapore would cost you $1,794,000 USD.

Would this be worth the cost?  Christians discusses how some of these nations hope to attract wealthy citizens from other nations.  However, emigrating from the U.S. is harder to accomplish, at least from a tax perspective, due the U.S. practice of taxing its citizens on worldwide income.  Christians thus also discusses barriers to exit, again from a citizenship tax perspective. 

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September 29, 2017 in Scholarship, Tax, Weekly SSRN Roundup | Permalink | Comments (0)

Tax Policy In The Trump Administration

Weekly Legal Education Roundup

Facing Poverty, Academics Turn to Sex Work And Sleeping In Cars

AdjunctFollowing up on my previous posts on the plight of adjunct professors (links below):  The Guardian, Facing Poverty, Academics Turn to Sex Work and Sleeping in Cars:

Adjunct professors in America face low pay and long hours without the security of full-time faculty. Some, on the brink of homelessness, take desperate measures

There is nothing she would rather do than teach. But after supplementing her career with tutoring and proofreading, the university lecturer decided to go to remarkable lengths to make her career financially viable.

She first opted for her side gig during a particularly rough patch, several years ago, when her course load was suddenly cut in half and her income plunged, putting her on the brink of eviction. “In my mind I was like, I’ve had one-night stands, how bad can it be?” she said. “And it wasn’t that bad.”

The wry but weary-sounding middle-aged woman, who lives in a large US city and asked to remain anonymous to protect her reputation, is an adjunct instructor, meaning she is not a full-time faculty member at any one institution and strings together a living by teaching individual courses, in her case at multiple colleges.

“I feel committed to being the person who’s there to help millennials, the next generation, go on to become critical thinkers,” she said. “And I’m really good at it, and I really like it. And it’s heartbreaking to me it doesn’t pay what I feel it should.”

Sex work is one of the more unusual ways that adjuncts have avoided living in poverty, and perhaps even homelessness. A quarter of part-time college academics (many of whom are adjuncts, though it’s not uncommon for adjuncts to work 40 hours a week or more) are said to be enrolled in public assistance programs such as Medicaid.

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September 29, 2017 in Legal Education | Permalink | Comments (5)

Law School Student Loan Default Rates

ABA Journal (2014)ABA Journal, Which Law Schools Had Highest Loan Default Rates for Fiscal Year 2014? (Updated): 

Six freestanding law schools recorded student loan default rates greater than 2 percent for Fiscal Year 2014, according to data released Wednesday by the U.S. Department of Education.

The Institute for College Access & Success, a nonprofit group that works to increase the public’s understanding of student debt, designed a sortable spreadsheet with the Department of Education data. Based on that offering, freestanding law schools with the largest percentages of student loan defaults for fiscal year 2014 were:

1. Massachusetts School of Law (4.8%)
2. Thomas Jefferson (3.8%)
3. Appalachian (2.9%)
4. San Joaquin College of Law (2.6%)
5. Thomas Cooley (2.5%)
6. John Marshall (Atlanta) (2.3%)

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September 29, 2017 in Legal Education | Permalink | Comments (22)

Lesson From The Tax Court: The Overlooked Power Of Offset

Tax Court (2017)Last week the Tax Court issued an opinion in Williams v. Commissioner, T.C. Memo 2017-182.  Although it involves small amounts, the opinion teaches a big lesson about the IRS power of offset

Mr. Williams filed his 2013 return reporting $503 of taxable income and withholding of $1,214.  So he claimed an overpayment of $711.  The IRS accepted his return as filed but did not refund the $711.  Instead, it used its offset powers under section 6402(a) to credit that supposed $711 overpayment against Mr. Williams' unpaid tax liabilities from 2011.  Later, the IRS audited Mr. Williams' return and proposed a deficiency of $1,403.  Mr. Williams' protest to Tax Court was not the usual one.  He agreed with the amount of the deficiency, but he thought that since there was not actually an overpayment, per the audit, then the IRS should not have credited that $711 to his 2011 liability but should instead apply it to his 2013 liability.  After all, it was part of the wage withholding for 2013.  Note that it was to Mr. Williams' benefit to pay off the most recent tax liabilities to increase the chances that the older ones would age out.

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September 29, 2017 in Bryan Camp, New Cases, Tax, Tax Practice And Procedure | Permalink | Comments (2)

Simkovic: The Law School Monopoly Myth

Michael Simkovic (USC), The Law School Monopoly Myth:

It is often assumed that the only way to become a lawyer is to attend an ABA-approved law school.  That is true in some states and, indeed, the ABA has at times expressed the view that it should be true in all states.  But it is not the case in large jurisdictions such as New York or California, nor is it the case in the majority of jurisdictions.  Claims that ABA-approved law school have a monopoly on entry into the legal profession are exaggerations.  Rather, the most popular — and probably most likely — way to become a lawyer is to graduate from an ABA-approved institution.  ...

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September 29, 2017 in Legal Education | Permalink | Comments (0)

Mann:  Controlling The Environmental Costs Of Obesity

Roberta F. Mann (Oregon), Controlling the Environmental Costs of Obesity, 47 Envt'l L. 697 (2017):

Obesity is increasingly viewed as a major health problem across the world. Obesity presents both external and internal costs. Obesity alone may be responsible for some $2 trillion in medical costs and lost productivity, representing significant external costs. Internal costs occur because people make eating and drinking choices without being aware of the eventual damage to their health. Obesity also carries environmental costs. Consumption of certain energy-dense foods made from corn and soy (including meat) increases soil erosion and water pollution from fertilizer use. Governmental policy encourages the production of such crops. Being overweight decreases physical activity and personal mobility, leading to increased use of motor vehicles. Environmental factors such as sprawl and transportation policy affect obesity rates. When people cannot walk or take public transportation to work, they spend more time in their cars. They have less time to exercise and prepare healthy meals. Hence, both obesity’s effect on the environment and the environment’s effect on obesity lead to increased carbon emissions and exacerbate climate change. Taxes can potentially control both the external and internal costs of obesity. By increasing the cost of certain foods, taxes can discourage their consumption. A number of national and subnational jurisdictions have enacted such taxes, including Denmark, Finland, France, Mexico, the Navajo Nation, and the city of Berkeley, California in the United States.

This Article will examine a variety of economic instruments for controlling obesity, including regulation, taxes, and nudges.

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September 29, 2017 in Scholarship, Tax | Permalink | Comments (0)

Thursday, September 28, 2017

Kleinbard: The Republican Tax 'Plan' Is A Deficit-Busting Mess

Vox op-ed:  The Republican Tax “Plan” Is a Deficit-Busting Mess. And It Would Slash the President’s Taxes, by Edward Kleinbard (USC):

Here is what you need to know about the Republican tax plan released Wednesday: It’s not a tax reform plan at all.

It is a sketch of an outline of a preliminary notion of a tax cut for some — and a tax hike for others. The components read like the jumble of ideas you might expect a table of slightly inebriated Chamber of Commerce types to shout out when polled for their tax reform suggestions.

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September 28, 2017 in Tax | Permalink | Comments (3)

McArdle: It Shouldn't Be So Easy To Go To Grad School

Bloomberg View:  It Shouldn't Be So Easy to Go to Grad School, by Megan McArdle:

Universities are milking the huge loan sums from grad students to subsidize the cost of undergraduate degrees. This system is broken.

Almost 20 years ago, when I was applying to MBA programs, the conventional wisdom was that unless you could get into a top-10 program, 1 you probably shouldn’t go. The tuition at a high-ranking program was steep (I would eventually graduate with nearly $100,000 in debt), but if you managed to get in, recruiters for six-figure jobs would swarm onto campus and practically beg you to work for them.

The tuition at lower-level schools was also very steep, but students had to frantically labor to secure a job afterwards. Some found jobs that were no better than the jobs they’d left to go to business school. The lower the ranking of the school, the less value the graduates got out of their degree, until you got down to programs that seemed to mostly be run for the benefit of the university that was collecting the tuition check.

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September 28, 2017 in Legal Education | Permalink | Comments (1)

Bartlett: I Helped Create The GOP Tax Myth. Trump Is Wrong: Tax Cuts Don’t Equal Growth

Washington Post op-ed:  I Helped Create the GOP Tax Myth. Trump Is Wrong: Tax Cuts Don’t Equal Growth, by Bruce Bartlett:

Four decades ago, while working for Rep. Jack Kemp (R-N.Y.), I had a hand in creating the Republican tax myth. Of course, it didn’t seem like a myth at that time — taxes were rising rapidly because of inflation and bracket creep, the top tax rate was 70 percent and the economy seemed trapped in stagflation with no way out. Tax cuts, at that time, were an appropriate remedy for the economy’s ills. By the time Ronald Reagan was president, Republican tax gospel went something like this:

  • The tax system has an enormously powerful effect on economic growth and employment.
  • High taxes and tax rates were largely responsible for stagflation in the 1970s.
  • Reagan’s 1981 tax cut, which was based a bill, co-sponsored by Kemp and Sen. William Roth (R-Del.), that I helped design, unleashed the American economy and led to an abundance of growth.

Based on this logic, tax cuts became the GOP’s go-to solution for nearly every economic problem. Extravagant claims are made for any proposed tax cut. Wednesday, President Trump argued that “our country and our economy cannot take off” without the kind of tax reform he proposes. Last week, Republican economist Arthur Laffer said, “If you cut that [corporate] tax rate to 15 percent, it will pay for itself many times over. … This will bring in probably $1.5 trillion net by itself.”

That’s wishful thinking. So is most Republican rhetoric around tax cutting. In reality, there’s no evidence that a tax cut now would spur growth. ...

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September 28, 2017 in News, Tax, Tax Policy in the Trump Administration | Permalink | Comments (2)